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Debtor Risk Assessment

Company insolvency risk forecasts over the next twelve months

Debtor Risk Assessment (DRA) measures the probability that a company will default over a 12 month period. It predicts the likelihood of the business having difficulty in surviving as a trading entity. DRA uses different statistical methods and combines hard facts (such as financial data and ratings) and soft facts (e.g. company management).
The assessment scale ranges from 0 (company in default) to 10 (the best evaluation possible). Coface clients can access the DRA via CofaNet Essentials. Daily alerts of changes in the DRA of your portfolio allow you to make the right decisions and better manage your credit risk.

What goes into a DRA?

coface debtor risk assessment

Coface uses a number of data elements to assess a company's short-term probability of default. The core of the assessment is comprised of data points from the following categories:

  • Financial Data - Based on a company's consolidated financial figures
  • Commercial Payment Performance - Derived from statistical scores
  • Company Identity Data - Including company age, location, line of business, employees, court rulings, etc.

 Additional inputs include:

  • Financial Lines Adjustments - Taking into account the company's ultimate parent
  • Trend Behavior - Based on the history of a company's DRA
  • Advanced Coface Indicators - Adjusting for external shocks to the economy according to a company's sector, size and geographic location
  • Coface Senior Analysts - Who review and DRAs



10. Very high financial stability
Large and extremely stable companies. Solidity is undoubted. Risk of default is close to zero.


9. High financial stability
Large to medium sized companies or groups of companies demonstrating a high level of financial stability. Exposures could only be jeopardized by extreme and unforeseen external factors. Risk of default is very low.


8. Good financial stability
Financials are basically sound. In addition to extreme factors, exposures are sensitive to the business environment. Nevertheless, risk of default is low.


7. Stable, slightly above average financial stability
Financial performance and stability for large companies/group of companies is slightly above average for medium size businesses it is considered normal. Risk of default is slightly above average.


6. Average financial stability
Financial stability is average. The sensitivity to external adverse factors should not be neglected. Risk of default is average.



5. Medium Risk
Financial performance and above all stability are clearly below average. Risk of default must be considered but remains acceptable in most cases for short term credits.


4. Increased Risk
There are some problems. If they are not resolved, the ability to fulfill obligations could clearly be affected. Risk of default is significant but may be acceptable for limited short therm credits.



3. High Risk
Financial situation and reliability are questionable. Risk of default is high.


2. Very High Risk
Financial situation is very poor and close to critical. Risk of default is very high.


1. Extremely High Risk
Demonstrates clear signs of financial distress. Any commitment is linked with a high probability of default. Risk of default is extremly high.


0 Default


  • Coface analysts constantly refine and validate data from 200 millions of companies
  • Usually instant results, unless extra investigations are required
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